Netherlands: Delta Lloyd offers First Year's Budget to employers

Article date: 21 October 2009

The pension provider Delta Lloyd is offering the First Year’s Budget to employers from 1 October. The First Year’s Budget meets the costs which employers incur when they take out a pension plan. Employers can use this as a reduction in the costs of the pension plan or can offset it against the extra man hours put in by pension advisers when setting up the insurance. In addition to the introduction of the First Year’s Budget Delta Lloyd is adjusting the level of the pension provision for the Personal Pension Plan.

The experience of pension advisers and surveys shows that many employers need some means of offsetting the costs which they incur when they conclude a pension contract. The lion’s share of the costs of a pension plan is incurred in the start-up period. The Resolution on the Monitoring of Conduct of Financial Companies (BGFO, in Dutch) states that sales-related commissions are no longer permitted since the start of this year. With budgets in free-fall, Delta Lloyd is taking employers’ needs on board by introducing a First Year’s Budget.

What’s included in the First Year’s Budget?
The First Year’s Budget is based on the annual premium under the contract. The First Year’s Budget only applies to the setting up of the pension contract. It applies both to new contracts and to contracts that have been extended by a minimum contract period of five years based on a premium volume of €10,000.

Why have a First Year’s Budget?
Despite the fact that 55% of employers consider a good pension provision to be the most important secondary condition of employment for their employees (after leave allowance), 25% would currently make direct savings on their employees’ pensions if they could do so*. So employers have an eye on affordability and want to have more insight into setting up pensions. Employers need clear communication when it comes to pensions. This is why it costs more time and money for employers to set up a good pension plan. The First Year’s Budget absorbs the initial costs when taking out pension insurance. 

Why is the maximum provision for the Personal Pension Plan being adjusted?
In the interest of an available premium plan for the individual stakeholder, Delta Lloyd has reduced the maximum provision of the Personal Pension Plan. The current provision of the Personal Pension Plan is being maximised to 8% and a maximum of 50% of this can be converted to cash.

Further information can be found on Delta Lloyd’s website ( and at


* Kien undertook a quantitative survey, commissioned by Delta Lloyd, in August 2009 of 508 employers in small and medium businesses.

Further information:
Marijke Peijnenburg
Spokesperson for Delta Lloyd Insurance
Telephone: (020) 594 29 39

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